Global spending on public cloud services is expected to grow 18.6% in 2012 to $110.3B, achieving a CAGR of 17.7% from 2011 through 2016. The total market is expected to grow from $76.9B in 2010 to $210B in 2016. The following is an analysis of the public cloud services market size and annual growth rates:

Gartner predicts that Infrastructure-as-a-Service (IaaS) will achieve a compound annual growth rate (CAGR) of 41.3% through 2016, the fastest growing area of public cloud computing the research firm tracks. The following graphic provides insights into relative market size by each public cloud services market segment:

Platform-as-a-Service (PaaS) will achieve a 27.7% CAGR through 2016, with Cloud Management and Security Services attaining 26.7% in the same forecast period. Software-as-a-Service’s CAGR through 2016 is projected to be 19.5%. The following graphic illustrates the differences in CAGR in the forecast period of 2011 – 2016:

Gartner is projecting the SaaS market will grow at a steady CAGR of 19.5% through 2016, having increased the forecast slightly (.4%) since its latest published report. Global SaaS spending is projected to grow from $13.5B in 2011 to $32.8B in 2016.

CRM will continue to be the largest global market within SaaS, forecast to grow beyond $5B in 2012 to $9B in 2016, achieving a 16.3% CAGR through 2016. The highest growth segments of the SaaS market continue to be office suites (49.1%), followed by digital content creation (34.0%). The following graphic rank orders CAGRs across all public cloud services segments from the forecast period:

59% of all new spending on cloud computing services originates from North American enterprises, a trend projected to accelerate through 2016. Western Europe is projected to be 24% of all spending. A graphic comparing total spending by geography and corresponding growth rates is provided below: